Hannon Armstrong Sustainable Infrastructure Capital has bought $107 million worth of land leases for solar and wind projects, according to a statement.
The Annapolis, MD-based investment firm has acquired the leases through its purchase of American Wind Capital Company, a Connecticut–based business that monetises long-term, contracted lease agreements in solar and wind projects. There is no debt, liabilities or employee transfer resulting from the deal, according to legal advisor Latham & Watkins LLP.
The acquired portfolio comprises more than 7,500 acres of land leased to three solar projects, worth of around $60 million, as well as payments from eleven additional land leases for wind projects with a value of $27 million. Another portfolio of 46 smaller payments from land leases on wind projects is also included.
The wind and solar projects involved are developed or owned by a number of renewable power generation businesses, such as Southern Company, NRG Yield, First Solar and NextEra, and backed by long-term investment-grade power purchase agreements from utilities such as SDG&E, PG&E, LADWP and SCE.
“Strategically, this transaction is a terrific fit: it adds high credit quality assets at attractive risk-adjusted yields, grows our near term pipeline and increases our capacity to add distributed energy assets by expanding our Real Estate Investment Trust (REIT) asset base,” said chief executive officer Jeffrey Eckel.
Along with the transaction, Hannon Armstrong also announced that it has expanded its credit facility by $200 million. The new terms boosted the maximum borrowings permitted in the firm's project finance facility from $150 million to $250 million, and an increase in its total maximum advances from $700 million to $900 million.